Officials at the Gary/Chicago International Airport Authority are tightening accounting practices after an audit disclosed a 2017 year-end cash balance was overstated by $647,000.

The audit, completed by Whittaker & Company, a private Gary accounting firm, was recently released by the Indiana State Board of Accounts.

The audit blamed posting errors and errant journal entries for the checking account overstatement of funds.

During a review of sample entries, the audit found they lacked consistent documentation and analysis. “This condition was pervasive throughout 2017,” the audit stated.

The audit stated the finding was the result of a lack of supervision of staff and training for new staff in the authority’s finance department.

In response, finance manager William Outlar said the bank reconciliations are now being included in the monthly financial reports reviewed for acceptance by the airport authority board.

He said funds deposited or transferred between funds will be recorded in the fund deposited into and then transferred to its correct fund so the transactions flow with the general ledger. “We will eliminate the past practice of recording estimated tax revenues on a monthly basis and record those revenues as we receive them to alleviate the recording overstatement of prospective cash,” Outlar wrote.

He said journal entries would be more detailed, as well.

Jennifer Marshall, an examiner with the State Board of Accounts who reviewed the audit, said while the accounting finding was serious, she said the response and acknowledgment of the problem was thorough.

“It doesn’t seem to be indicative of any wrongdoing, just that accounting practices in internal controls are not as strong as they should be. They do seem to acknowledge that and have implemented controls,” she said.

The audit also said effective controls were not established to allow for review and verification of a federal report, the Schedule of Expenditures of Federal Awards. It said the funds were correct in total, but auditors weren’t able to tie specific federal funding to each project.

Airport officials said they would create a schedule to record and document funds received per grant. Additional oversight will be provided by airport manager, Aviation Facilities Co., known as AFCO.

Carole Carlson is a freelance reporter for the Post-Tribune.